Mortgage Parameters Eased for Mongolian Citizens

On Wednesday, the Minister of Construction and Urban Development, Ts.Bayarsaikhan, informed the press of the new policies to be adopted by the ministry.

At the beginning of the conference Ts.Bayarsaikhan stated, “Recently, some of the issues in the construction sector have reached a point where the industry has become worrisome to the public. Therefore it is right that we make certain demands and take responsibility regarding health and safety measures and construction standards.”

Since his appointment to the office of Minister, Ts.Bayarsaikhan has taken the initiative to visit companies that operate in the field of construction such as construction material factories, contracting companies, and organizations responsible for public utility and engineering lines. He has reached the conclusion that the legal side is not the main source of the rising issues but rather the problems relate to individual responsibility and the lack of enforcement of laws and policies.

The Minister stated that changes to construction sector are being planned and a project reviewing policies will be discussed by the parliament. The issue of extending construction material production has been enlisted in the plan. Ts.Bayarsaikhan noted that this will help limit inflation. With this in mind, the old process of building construction material will be totally revamped. Furthermore, he intends to solve the bank loan issue as well, and stated that this issue will be stressed in the monitory policy.

Ts.Bayarsaikhan explained that on the other hand the construction financing policy should be improved. The six percent interest apartment loan implemented by the government has been in high demand but the initiative has been limited to those purchasing apartments for the first time. Hence, he believes that in the future, every citizen of Mongolia should be eligible for a mortgage.

Furthermore, he hopes to help young people and those with low or medium incomes by conducting a research on providing the financial backing for them and including it in construction financing programs. Ger district infrastructure is in the works to be improved by connecting them to a central heating system as well as water and drainage lines, in addition to the reconstruction of the roads in those areas.

The Minister of Construction will make changes to the law regarding urban development and construction and will make it easier to acquire special construction permits by reducing the number of signatures required to be collected—which is currently 120 to 125. The Law on Urban Development also states that new construction must have pavement, a section for “green establishments” and public space, and further stipulates that the actual building must take up only 70 percent of the purchased land. At the moment, this policy has not been implemented at all and because of this, buildings end up using 100 percent of the purchased land which contributes to all sorts of accidents. This policy will be made clear in the new law and there will be an increase in the penalty for violations.

Ts. Bayarsaikhan states that from now on, the priority standard for future buildings will be the geared toward heat-loss parameters and energy efficiency. He further noted that plans for future construction and expansions will have a new and clear set standard, and the health and safety measures will be inspected thoroughly by the specialized inspection agency.

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